About Me

greekdefaultwatch@gmail.com
Natural gas consultant by day, blogger on the Greek economy by night. Trained as an economist and political scientist. I believe in common sense and in data, and my aim is to offer insight written in language that is clear and convincing.

30 April 2006

The oil CEO

This is from James K. Glassman at the American Enterprise Institute; it captures nicely the downside of the high-pitched rhetoric in Washington (the same dilemma applies to foreign producers who are both demonized and expected to invest money to expand their supply of oil): “Imagine you're the CEO of an oil company today, listening to Specter talk about a windfall profits tax, the President go on about "addiction" or Frist about "price gouging." Your main job as CEO is to allocate capital, to decide where to put your shareholder's money for the long term. Are you encouraged to make "strong re-investment [of] cash flows" in this environment? I doubt it. Maybe the best idea is to stash the cash in Treasury bills or buy a retail chain or give the money back to investors.” (link)